Percy Corporation was formed on January 1. The corporate charter authorized 100,000 shares of $10 par value common stock. During the first month of operation, the corporation issued 400 shares to its attorneys in payment of a $5,000 charge for drawing up the articles of incorporation. The entry to record this transaction would include:
A. A debit to Organization Expenses for $5,000.
B. A debit to Organization Expenses for $4,000.
C. A credit to Paid-in Capital in Excess of Par Value, Common Stock for $5,000.
D. A debit to Paid-in Capital in Excess of Par Value, Common Stock for $2,000.
E. A credit to Common Stock for $5,000.
Answer: A
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